House GOP Tax Plan Preserves 2017 Cuts, Benefits Wealthy Amid $5 Trillion Cost

House Republicans have proposed a sweeping tax and budget package that aims to make permanent the 2017 Trump tax cuts while introducing new tax breaks for tipped income, overtime pay, private school tuition, seniors, and state and local taxes. Despite earlier suggestions from former President Trump to raise taxes on multimillionaires, the current GOP bill excludes the 39.6% top tax rate for the wealthiest, directing the majority of tax cuts to high-income earners, particularly those making over $217,000, with the top 1% receiving nearly one-quarter of the benefits. Analyses from the Urban Institute and the Tax Policy Center highlight that low-income families would suffer significant income losses due to Medicaid and food stamp cuts, while wealthier families would see net gains. The legislation would also add trillions to the national debt, partially offset by nearly $1 trillion in Medicaid and other spending cuts over a decade, raising concerns about the fiscal impact. Additionally, the bill's estimated cost of nearly $5 trillion reportedly exceeds the budget limits Republicans set earlier this year, complicating efforts to pass the package promptly. Speaker Mike Johnson aims to pass the bill before Memorial Day, but lawmakers face a mid-July deadline to raise the debt ceiling and avoid a government default.